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Morgan Stanley Q4'19 profit surges; net revenues climb 27% YOY

Morgan Stanley reported earnings applicable to common shareholders of $2.09 billion, or $1.30 per share, for the fourth quarter of 2019, an increase from $1.36 billion, or 80 cents per share, in the year-ago period.

The S&P Global Market Intelligence consensus GAAP EPS estimate for the quarter was $1.00.

The investment banking giant reported institutional securities net revenues of $5.05 billion in the fourth quarter of 2019, an increase from $3.84 billion in the year-ago period. Investment banking revenues increased year over year by 11% to $1.58 billion, as equity underwriting and fixed income underwriting revenues increased and advisory revenues decreased. Sales and trading revenues grew 28% year over year to $3.19 billion, with fixed income sales and trading net revenues seeing a significant increase to $1.27 billion from $564 million, and equity sales and trading net revenues seeing a slight year-over-year decrease to $1.92 billion from $1.93 billion.

Wealth management net revenues for the quarter increased year over year to $4.58 billion from $4.14 billion. Investment management net revenues for the quarter significantly increased from the year-ago period to $1.36 billion from $684 million, as investment revenues jumped to $670 million from $82 million. Morgan Stanley attributed this year-over-year increase in investment revenues to accrued carried interest related to an underlying investment's IPO, subject to sales restrictions, within an Asia private equity fund managed on behalf of clients.

Overall, Morgan Stanley's net revenues for the fourth quarter of 2019 were $10.86 billion, a 27% increase from $8.55 billion in the fourth quarter of 2018.

Morgan Stanley reported earnings applicable to common shareholders of $8.51 billion, or $5.19 per share, for full year 2019, an increase from $8.22 billion, or $4.73 per share, in 2018. Net revenues for 2019 slightly increased year over year to $41.42 billion from $40.11 billion.

The S&P Global Market Intelligence consensus GAAP EPS estimate for 2019 was $4.90.